Late slump eclipses tech rally Dow off 33

Internet firms advance but earnings concerns weigh on other stocks

Wall Street

November 11, 1998|By BLOOMBERG NEWS

NEW YORK -- U.S. stocks fell in a late-day slump yesterday, as concern that earnings may slow dragged down oil and financial shares, overshadowing a rally among Internet companies.

The Dow Jones industrial average fell 33.98 points, to 8,863.98, and the Standard & Poor's 500 index slipped 1.94, to 1,128.26. The Nasdaq composite index rose 4.57 to 1,865.62.

The Russell 2,000 index of small-capitalization stocks slid 1.57, to 396.86; the Wilshire 5,000 index fell 23.81, to 10,352,17; the American Stock Exchange composite index lost 1.02, to 665.09; and the S&P 400 midcap index slipped 2.00, to 347.05.

The Sun-Bloomberg Maryland index of the top 100 Maryland stocks fell 1.00, to 192.80.

Declining stocks outnumbered advancers by a 3-to-2 margin on the New York Stock Exchange.

Exxon, Morgan lower

Oil companies, such as Exxon Corp., and financial companies, including J. P. Morgan & Co., led the market lower.

J. P. Morgan fell $2.125, to $97.625, and American Express Co. slid $2.125, to $92.75.

Exxon fell $1.875, to $70.125.

In the final minutes of trading, Minnesota Mining and Manufacturing Co. slumped $2.4375, to $76.8125.

DuPont Co., the biggest U.S. chemicals company, fell $1.1875, to $60.6875, accounting for a third of the Dow average's decline.

DuPont slid after Germany's BASF AG, Europe's No. 1 chemicals maker, said business in the third quarter fell short of expectations and warned that it does not expect economic conditions to improve in the rest of 1998.

Holiday outlook

Internet companies such as Yahoo! Inc. rallied on speculation that they may benefit from a surge in online shopping and advertising revenue during the holiday season. Online companies represented three-quarters of the top 20 most active stocks.

Yahoo!, the No. 1 Internet directory, rose $12.8125, to $177.5625., an online bookseller, rose $4.875, to $131.75. America Online Inc., the No. 1 online service, rose $3, to a record $147.75. Excite Inc. rose $4.125, to $51.625.

eBay Inc., an online auctioneer, gained $27.875, to $130.875, after Rakesh Sood, an analyst with Goldman Sachs & Co., raised his target price to $150. Sood said eBay, which began trading in September, was benefiting from strong growth.

K-tel International Inc. rose $11.375, to $22.9375, buoyed by an agreement to include its online music and home video service on Microsoft Corp.'s shopping channel, MSN Shopping.

MindSpring Enterprises Inc. gained $4.5625, to $57.375. The Internet software company said it acquired the consumer Internet subscribers of Cox Communications Inc.'s Cox Interactive Media for an undisclosed amount. MindSpring has gained 49 percent since Nov. 3.

Computer makers led gainers in the S&P 500. International Business Machines Corp. rose $3.875, to $155.25, an all-time high. Dell Computer Corp., which is expected to report earnings after the market's close tomorrow, was the most active stock in U.S. trading, rising $1.3125, to $70.3125, as 39.6 million shares changed hands.

Intel Corp., the world's largest semiconductor maker, gained $1.5625, to $97.5625.

After markets closed, Intel said its fourth-quarter revenue would beat expectations and grow by 8 percent to 10 percent above the third quarter's $6.7 billion.

Broadcom Corp. rose $4, to $96.50, after being reiterated a "buy" by Joseph Osha, an analyst at Merrill Lynch & Co.

The computer chip maker has unveiled a single chip that melds World Wide Web pages and television images on TV screens, paving the way for seamless mingling of scenes from TV channels, Web sites, videocassettes and digital video disk movies.

Drive maker sued

Iomega Corp., a computer disk-drive maker, fell 37.5 cents, to $7.625, after it was sued by a group of customers who contend that the drives have a fatal flaw that can damage Zip storage drives beyond repair.

Philip Morris Cos. rose $1.0625, to $54.125; RJR Nabisco Holdings Corp. gained $1.125, to $29.25; and Loews Corp. rose $3.75, to $98.50.

Merck & Co. rose for a fourth day to a record on optimism that its new generation of arthritis drugs will fuel profits for year to come. Merck gained $1.1875, to $146.75.

Among oil service stocks, Weatherford International Inc. fell $2.375, to $24.75, and Smith International Inc. lost $2, to $36.0625. Transocean Offshore Inc. slipped $2.8125, to $33.50.

Pub Date: 11/11/98

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